How to estimate 200+ unit apartment complex rehab cost?

[Chris Reeves]

Any help on this is much appreciated. I've had an off market, bank owned rehab deal brought to me by a broker we've bought from before and trust. My specific question is how to go about inspecting a complex this large and putting together a detailed, accurate figure for what it will cost to rehab the complex.

I have no problem modeling the financials for a stabilized property, evaluating the market, etc. We operate in that market already, have effective management experienced in doing rehabs, etc. We have three decades of our own operating data in several different markets to build projected NOI for this property,

But we have not done a distressed physical rehab before.

I have been given a price for the complex, and a price for the rehab, and a financing package from the bank which has taken the complex from its owner that includes funding for the rehab costs, and good LTV.

The complex is operational but is over 40% vacant, and is the classic story of an owner who gradually drained their property, eventually lacking the money to do unit turns.

What I would like to do is bring in an independent team to walk the property unit by unit and build out a detailed rehab budget - a team without the conflict of interest of being hired by the bank who owns the property, or being brought in by my existing management firm.

Should I hire tradesmen with specific skills (electrical, drywall, plumbing, roofing, etc.) and pay them each a fee to walk the property? Should I hire a contracting firm to do the inspection?

We need to get this number reasonably accurate in order to model the ROI. It is a value add with margins that look pretty sweet - but if the rehab goes double or triple what's been projected then the deal quickly goes from sweet to "meh."

For the work itself, we are looking at around 100 units which need to be rehabbed - I would prefer to do the work all at once - so should I be dealing with only mid-size to large contractors?

Thanks in advance!